The treatment of bone loss, whether due to trauma or disease, remains a significant challenge for the orthopaedic surgeon. Current treatment modalities include the use of autograft and allograft bone. Limitations assoicated with use of autograft bone include a required second surgical procedure for graft isolation and a potential for donor site morbidity; allograft bone carries the risk of disease transmission and immunological rejection. To improve healthcare, a less traumatic alternative to current bone replacement procedures is the implantation of tissue-engineered bone. The goal of this project is to promote the neogenesis of bone and supporting vasculature by combining strategies of gene therapy and tissue engineering to design and evaluate a synthetic, osteoinductive matrix which uses an alternative stromal cell source, adipose tissue-derived stromal cells, for factor delivery. This will be achieved by the isolation and culture of adipose tissue-derived stromal cells on a 3-dimensional scaffold, of the biomaterial poly(lactide-co-glycolide). Transfection of the adipose tissue-derived stromal cells with the cDNA of bone morphogenetic protein-2 (BMP-2) and vascular endothelial growth factor (VEGF) will impart the natural release of factors to promote new bone and vascular formation. The cell-polymer composite will also be examined for in vitro auto-induction of the adipose tissue-derived stromal cells down an osteoblastic lineage and in vivo osteoinduction of the composite using a murine model for heterotopic bone formation. This project has three specific aims: (1) Culture primary human adipose tissue-derived stromal cells on a three-dimensional poly(lactide-co-glycolide) [3D-PLAGA] sintered microsphere matrix, (2) The in vitro evaluation of BMP-2 and VEGF producing adipose tissue-derived stromal cells and subsequent culture on a 3D-PLAGA matrix, and (3) The induction of heterotopic bone formation and enhanced angiogenesis in a severe combined immune deficient (SCID) mouse model. It is anticipated that this project will determine the ability of adipose tissue-derived stromal cells to adhere and proliferate on an FDA approved biomaterial and will further scientific understanding of the ability for adipose tissue-derived stromal cells to serve as an alternative cell source in the development of genetically-engineered and tissue-engineered synthetic bone graft systems.